THE PAST AND FUTURE: SOCIAL CONTRACT, SOCIAL POLICY AND SOCIAL CAPITAL Cornelia Butler Flora Jan L. Flora Iowa State University Social Contract Early social theorists (Thomas Hobbes, John Locke, and Jean-Jacques Rousseau) were intrigued by the notion of order and the mutual obligation it entails. For them, a critical part of social order is the relation between the ruler and the ruled, which includes collective agreement on the criteria for distinguishing right behavior from wrong, and enforcing right action. Why do the vast majority of people do what they are supposed to do? Hobbes addressed the question by theorizing what he felt separated "civilized" society from savagery. The "state of nature," according to Hobbes, was based on each person gaining the most possible on an individual basis, resulting in a life that was "solitary, poor, nasty, brutish and short." Only when individuals, through a social contract, give up their individual liberty to a sovereign committed to defending the subjects' lives in exchange for obedience to the sovereign's rules, does order, and thus security, emerge. The Hobbesian argument justifies the power of the sovereign. If citizens do not obey the rules, harsh and even extreme punishment isj ustifiable, indeed, necessary. Locke differed from Hobbes in his view of history. He argued that the rights of life and property were recognized under natural law. Insecurity arose from lack of clarity as to who was to enforce those rights. The social contract involves individuals agreeing to obey the laws of the state in exchange for the state's protection of the person and property. Locke reasoned that, when the sovereign did not provide the appropriate protec- tion, overthrow of that sovereign was justifiable. Rousseau saw history as a movement toward increasing the power of reasoning, and the sense of morality and responsibility. When individuals agree, for the sake of mutual protection, to surrender individual freedom of action and establish laws of government, they acquire a sense of moral and civic obligation. This implied a constant negotiation between the state and its citizens to maintain legitimacy, and thus, social order. When government violates the social contract and loses its legitimacy, revolution is justified. Rousseau provided the intellectual basis for the French and American Revolutions. We are currently in a situation of renegotiation-not revolu- tion-of the social contract. The thrust of the Contract with America is a 53 shift from an emphasis on the rights of life to the rights of property. For that contract to replace the previous understanding of the relation of the state to its citizens, access to property, and the security it entails, will have to be as important as ensuring that those who now have property keep it. The balance of what government should provide for citizens-and citizen obligations to the state-are now in negotiation. Contracts are ultimately based on trust that the parties to the contract will live up to their obligations. What is needed for such trust to develop? One prerequisite is a degree of social and economic equality. The nineteenth century German social and economic theorist, Max Weber, argued that the "unfettered" market contributes to inequality; thus wealth and power accumulate rapidly into the hands of a few. An important role for public policy is to compensate for the "market failure" which is the result of structural inequality, despite a strong counter tendency for policy to codify and make even more severe existing inequalities. When the state fails to ensure a level playing field, civic culture does not flourish. Absent the state's guarantee of equity (enshrined in the U.S. Consti- tution as equality of opportunity, not necessarily of outcome), civic culture is beset by social distinctions which reduce the level of trust, and substantially increase the transaction costs of conducting daily community life. Important key questions for policy are: 1. How to make it profitable to do what is moral (rational self-interest reinforced by public policy), and 2. How to nurture a civic culture. A strong civic culture is a prerequisite for a common moral order (Putnam, 1993b). Our analysis of policy is based on the notion of a common moral order and the norms of mutual trust and reciprocity which underlie it. Using the terminology of other scholars, we call that "social capital." While Coleman and others use that term to refer to resources wielded by individuals, a concept based on rational choice and game theory, others (Portes and Sensenbrenner; Granovetter) approach social capital, or embeddedness, in terms of the formation of collective conscience, which provides a social, rather than individual, basis for action. Public policy has, in general, ignored social capital, choosing instead to try to enhance other resources: financial/manufactured resources, human resources, and, more recently, environmental resources. (See C. Flora for a discussion of the different kinds of capital that emerge from these resources). As a result, the unintended consequence of many policies is to decrease social capital and undermine the social structure (not individual motivation) that contributes to civicness and the common moral order. 54 Attempts, such as efforts by the religious right to impose a common moral order, which ignore the importance of social embeddedness as a structural prerequisite, further diminish social capital, and are thus counterproduc- tive. The level of all resources available to a society declines. Putnam (1995) uses longitudinal survey data to document the decline in civic engagement and levels of trust of individuals in the United States, which he summarizes in his title, Bowling Alone. He traces the decline of bowling leagues (and the accompanying decline in sales of food and drink at bowling alleys), and the increase in number of lines bowled, to the individualization of leisure and the separation of the individual from community. This concern is not with leisure but with democracy. Based on Roper polls, participation in town and school meetings, writing Congress, attending rallies or speeches, being a member of any civic committee, or doing volunteer political party work declined between 29 percent and 56 percent between 1973 and 1993. Weekly church attendance has declined between 1950 and 1991, although there are significant year to year fluctuations. Volunteerism, measured through involvement or membership in selected civic organizations, such as the Elks, Federated Women's Clubs, Lions and League of Women Voters, is decreasing. Volunteers in Scouting and the Red Cross are also down. Membership first declined in women's organizations as economic shifts and global restructuring basically required two incomes in households during the inflationary times of the 1970s. Participation in men's organizations followed suit in the 1980s, when for many families, particularly in the working class, even two incomes in a household were no longer adequate. Parent-Teacher Association membership is down from 1960 to 1992, even controlling for number of school age children. Spending social evenings with neighbors more than once a year (not a stringent indicator of neighborliness) declined about 12 percent between 1974 and 1995. Decreased participation in formal organizations is not replaced with informal interactions. Finally, social trust has declined precipitously. Distrust of government peaked at Watergate, and, by 1992, had returned to the Watergate level. Fifty- eight percent of the U.S. public agreed with, "Most people can be trusted," as opposed to, "You can't be too careful in dealing with people" in 1960, compared to 41 percent in 1975 and 37 percent in 1993. If social capital depends on mutual trust, certainly on an individual level, it is declining. This paper attempts to show the need for policy to take into account the balance among the various resources in society, particularly at the commu- 55 nity level. We argue that, in the past, policies which have sought to privilege a single resource and to maximize it, have reduced social capital-and thus the long term sustainability of the social system. By reducing social capital, often in the name of short-term problem solution which maximizes the return to a single resource, the social basis of the relation between citizen and state deteriorates, and extreme reactions-from the bombing of build- ings to the Posse Comitatis-emerge. There is a tendency to judge community progress in terms of the increase in financial and manufactured capital, in part because it is easy to measure. Financial and manufactured capital is either already monetized or easily expressible in monetary terms. Only if policy makers and citizens articulate additional goals for policy can alternative policies be developed. An unarticulated goal is that of enhancing social capital, trust and reciprocity. By articulating it, we make it legitimate to measure it, and, as is pointed out in Reinventing Government, what we measure is what we do. And as devolution is put into place, it is critical that we measure multiple goals at the community level. There are communities of interest and communities of place. A commu- nity of interest is composed of people who interact with each other, but who may not be together in the same place except for short periods of time. The National Public Policy Education Committee is a community of interest. Many members of that group are particularly concerned about the second type of community, community of place. The community of place is composed of people who live in and interact with one another within a geographic area. This geographic area may be urban or rural. Communities of interest can be very powerful. They are becoming more powerful as communities of place become more unstable. Communities of interest are able to mobilize a particular kind of capital that is a sub-category of social capital: political capital.